Gordhan squares up with Zuma

The Minister of Finance, Pravin Gordhan, has been set upon from all sides over the last couple of weeks. Although it has mostly died down, here is a brief summary of what, seemingly, happened.

Several actions discrediting Pravin Gordhan have been made in the last two weeks by the Minister of Police, the President and the head of SARS. Why, we can only theorise. The action was certainly not likely to do the South African economy any favours, especially because of the state it is in at the moment (any discrediting of Gordhan and threats to his continued position as finance minister will affect investor confidence).

We can find a few reasons for this fiasco in its history. The background to this ‘SARS war’ spans back to 2014 when Tom Moyane was appointed as the SARS Commissioner. Since then, he has seemingly gone to great pains to remove most, if not all, personnel within SARS that have ever shown strong loyalty to Gordhan (who was head of SARS before Moyane). He, seemingly in an attempt dismantle Gordhan’s legacy at SARS, has also dismantled many structures implemented by Gordhan. This has led to Gordhan ordering Moyane to cease the overhaul of SARS’s structure.

Tensions between Gordhan and Moyane have been running high since SARS leaked documents to the press, one of which revealed a ‘rogue’ investigative unit called the National Research Group (a force whose purpose was to root out political corruption) and implicated that Gordhan had knowledge of it.

On Thursday the 18th of February, Gordhan was sent a letter from the Hawks. This letter contained 27 questions about, among other things, his knowledge of a ‘rogue’ investigatory unit within SARS. Gordhan’s lawyers questioned what authority the Hawks had to question the Minister on the issue if he was not being directly charged, but answered some of the questions nevertheless.

Police Commissioner Nhleko indicated that the Hawks were not targeting Gordhan with the probe and that this probe was begun in May of 2015 (in effect he denies the accusation that this probe was to intimidate Gordhan before he delivered the budget speech). It was initiated after Tom Moyane had complained that NRG had overstepped its boundaries by doing what the intelligence agencies were mandated to do. This does not seem like an adequate defence to explain why the letter came at such a bad time, just before the Minister was to make his Budget speech. Although they did not lay formal charges against Gordhan, they must be aware that questioning him in such a manner implicates him in the crime and so affects his standing as Minister of Finance (at least temporarily).

Gordhan released a statement on the 26th of February defending himself. In the statement, he claimed the letter was a deliberate attempt to “intimidate and distract us [Gordhan’s team] from the work that we had to do to prepare the 2016 budget”. He further stated that, “The NRG, and subsequent investigative units, were legally constituted and approved at ministerial level.”

Overall, this whole fiasco has developed into a bit of a damp squib as not much has come from it other than a loss in investor confidence. The fight seems to have died down but given the animosity between the Minister and the Commissioner, who knows when something like this will flare up again?